Source: Robin Roth, Senior Contracts Editor, Conferon, Inc.
E-Specs: May 11, 2004

Most hotel contracts that provide for function space are skimpy at best on catering terms. You're certain to see the terms that the hotel regards as important, such as requirements that all food and beverage be supplied and prepared by the hotel, that underage drinkers will not be served, and of course - the food and beverage performance clause. But what about the terms that protect your group and ensure that the catered functions are successful?

Here is a checklist of key terms that you should consider including in every contract where there will be catered functions:

• Waitstaff ratios. Specify how many servers you require for how many guests at sit-down, plated and buffet meals at each type of meal. State that there will be no extra service or labor charges for these service ratios.
• Cocktail functions. Specify bartender ratios and that there will be no bartender or server fees (based on minimum revenue achieved per bar). State the legal liability of hotel for service of alcoholic beverages, including alcohol service policy, laws, and intoxication. Require an opening and closing inventory to verify charges for each cocktail function.
• Guarantees. Menu pricing should be guaranteed no later than six months out and not contingent upon submission of the final agenda. Guarantees for F&B functions should be due 48 or 72 hours prior (not including weekends). Overset and food preparation policy should be 5% (3% for groups over 1,000).
• F&B performance.
  • If there IS a clause - It should specify a minimum catering dollar amount, not including tax and service charge. If you fall short of that amount, you should only be liable for the lost profit (usually 35 - 40%) on the shortfall.
  • If there is NO clause - Make sure that contract states that you will not be responsible for any minimum commitment for food and beverage expenditures.
• Supplier of group's choice. Ensure that the contract allows the group to use its own supplier at no extra charge and that any exclusive suppliers are identified.
• Taxes/Service Charges. Specify the service charge so that it can be locked in for budgeting. Clarify if the service charge is taxable. These terms should be included in the initial hotel contract and should override the terms on the back of the Banquet Event Order (BEO). If you wait until the time when the BEO is presented, it will be too late to implement some of them.

(Note: This information is not intended to be "legal advice." A qualified attorney should be consulted to review all contract issues.)